Floating catalyst chemical vapor deposition (FC-CVD) for the synthesis of CNT fiber has brought nano-level properties of CNT to macroscale. In FC-CVD, carrier gas flow rate is one of the important parameters that influences the microstructure and the yield. In this work comprehensive investigation in two carrier gas systems (H₂ + Ar and H₂ + N₂) has been carried out. The mechanism for microstructural evolution and variation in yield for CNT fiber have been proposed for these two systems. Small angle X-ray scattering reveals that the CNT orientation improves with the flow rate for both H₂ + Ar and H₂ + N₂ carrier gases. The alignment of CNTs in CNT fiber as analyzed by angle-resolved Raman spectroscopy shows a similar trend. Improvement in fiber density and electrical conductivity is observed with increased carrier gas flow rate. Maximum electrical conductivity of 1.85(±0.16) × 10⁶ Sm^–1 and tensile strength of 641 (±68) MPa have been obtained at 4 SLPM of H₂ + Ar gas flow. Despite the improved alignment, a significant loss in carbon conversion is witnessed as a result of reduced residence time and lowering of partial pressure of the carbon source. H₂ + N₂ carrier gas mixture produces significantly lower carbon conversion compared to H₂ + Ar carrier gas despite of the same residence time, the reason for which has been explained.